Futures contracts in
futures trading are exchange-traded obligations to buy or sell a contracted amount of an underlying good at a specified price and date. remember : futures contracts give obligation not right like options. Futures contracts have underlying assets, such as foreign currency, stock indices, agricultural products, and many more.
In
futures trading there are two positions, which are long position and short position.
- long position is obligated to buy at futures price at maturity
- short position is obligated to sell at futures price at maturity
In futures trading, there is always the same number of long and short positions. Futures trading is a zero sum game, which is if a long position wins, the short position loses. Not easy successful in trading
futures.